Determining a school voucher’s worth

This is the third in a series of short comments upon the forms of regulation that will best serve the purpose of a parental choice system that is subsidized by vouchers. The specific subject of this essay will be the ideal size of the voucher and related financial issues.

Before I begin, however, I will briefly re-identify for the reader the two basic objectives to be pursued by any scheme of subsidized school choice. These are (1) parental empowerment and authority – hence civic responsibility, and (2) the welfare and ultimate autonomy of the child. The intended fiscal empowerment of mothers and fathers can be achieved only by legislated protections – “regulation,” if you will – that supports the parental liberty to choose. Our society leaves parents who are well-off free to decide because they do the best job for the child and for society. The only issue is how to rescue the authority of the have-not parents from their current bondage to the system and begin once more to nurture the child’s autonomy through the responsible family.

My assumption will be the amount of the voucher will probably vary in accord with the current variance within the state in expenditures both among grades and among categories of special education. Historically, we have spent more on tenth graders than kindergartners. Another possible variant is cost of living by place of residence; ten thousand dollars go further in rural areas in many states.

Should the size of the voucher be indifferent to family wealth? It is possible intellectually to perceive each child as a fungible object distinct from the family – each rendered equal by the state’s imposition of universal compulsory education. Such a moral imperative of dollar equality drives some theorists in their criticism of public systems that today vary widely in per pupil expenditure within the state. A more persuasive imperative for me is the equalization, not of the amount, but of the economic effort required of the family to pay the balance (where the voucher is less than 100 percent of the average cost).

The burden on parents can and perhaps should be made as nearly equivalent as we can make it, adjusting for such things as income, grade level, special needs, and number of children in the family. The poor might be vouchered at, say, 90 percent of today’s average expenditure by the state upon children of similar characteristics. In current systems that expend, say $10,000, perhaps the rich should get $1,000 and the poorest $9,000. These numbers, of course, are judgment calls. I should note in passing that, regarding private schools, for the state to set the voucher a bit below the estimated total average cost in the public sector would be a gesture comforting to those lawyers who want to be able to argue that the state is not paying for religion in private schools.

I turn now to the question whether the law should or can forbid various sorts of add-ons that would supplement the voucher whatever its amount. The most obvious of these is private tuition; should (can) the school be forbidden to charge extra tuition or fees beyond the voucher? At first it seems obvious that add-on tuition would conflict with the very purpose of any scheme designed to level access to lower-income families. This self-defeating effect might even offend certain state constitutions as irrational. The escape, however, is both obvious and plausible as policy. The state could require any such addition to the voucher be made wealth-neutral; parents would pay according to their means. For every extra dollar going to a school’s cost of operation the well-to-do family might pay two dollars; the welfare mother fifty cents. The effect would be little different from the practice currently common among private schools that make wealth-based add-ons an expectation of the better-off family.

The question is sometimes raised whether any general system of vouchers should forbid charitable grants to the school from philanthropists and foundations. It is a legitimate question for anyone interested in keeping the competitive aspects of the system pure. Some schools will wind up substantially better funded than others. Still, I have trouble imagining our stifling the charitable instinct. And such good luck for a school is unlikely to offend any constitution.

An important question is whether vouchers will save or cost the state money. It all depends. I will assume here the voucher will be sufficient for what today the state considers the minimum cost of a good education. The granting of half that amount would allow some families to choose and pay; for many it would not solve the problem. Suppose instead that the state in fact grants 80 percent of its current average cost; and suppose that cost is $10,000. Will the state save money? Not if we assume that a large portion of families now paying tuition in private schools decide to take the voucher. Private schools (like charter schools) are cheaper on average, but the subsidized population will now be larger. Hence the state will be encouraged, by various techniques, to defer the vouchering of current private school students, just as most of the programs enacted to date have done.

Introducing a school choice program is a delicate process and calls for the wisdom of prudent economists. My colleagues in the American Center can produce any number of cost-free models tailored to the economic and political realities of the individual state. Here I can only hope to make more evident the variety of possible solutions. Perhaps the most obvious of these is an adjustment in the size of the voucher according to the family’s capacity to pay. If better-off families carried a share of tuition that equalizes the burden for all, the state could save or spend on school choice as it preferred. Whether any school choice system meets that standard lies in its capacity to assure the same access to all schools of choice for families who deserve to be responsible for their own children.

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